NEW YORK
— Home ownership has again hit record highs. And Jose Rojas, with his neatly tended three-family house in the Bronx, is a testament that the American dream is alive and well in what were once some of the nation's most distressed neighborhoods.

But there's a darker side to the US housing picture: More working families are seeking emergency shelter. Their requests for beds at shelters jumped by as much as 22 percent in the past year.

Together, these two realities reveal an unsettling irony of the housing legacy of the booming '90s. The same economy that lifted working people's wages, helping more people like Mr. Rojas to qualify for a mortgage for the first time in their lives, also pushed rents so high in some cities that many poor, working people were pushed out of their apartments. Some were forced to seek help at a homeless shelter, also for the first time.

"There is a still a significant, significant challenge out there," says Shaun Donovan, an affordable-housing expert at the Department of Housing and Urban Development in Washington. HUD estimates that more than 5 million Americans still live in substandard or inadequate housing.

But there are many reasons for encouragement. Innovative loan programs - requiring low down payments and offering favorable interest rates - are continuing to help some working families become homeowners. Regulators have aggressively enforced laws that require banks to lend even in distressed neighborhoods. And the number of African-American and Latino homeowners has also reached historic highs, following a seven-year period (1993 to 2000) when mortgages to black and Latino borrowers increased at three times the rate of mortgages to whites.

Some state and city leaders, too, are making affordable housing a higher priority. Many recent initiatives are concentrated in urban areas, where the affordable-housing crisis is the most acute.

* In New York, Mayor Rudolph Giuliani has pledged to create a $1.2 billion public-private partnership to build more than 10,000 units of affordable housing here.

* Iowa Gov. Tom Vilsack has proposed creating a $15 million trust fund for the construction of affordable housing - hoping to leverage as much as $1 billion in private financing.

* In Massachusetts, Gov. Paul Cellucci proposes selling surplus state land at a discount to developers who agree to build low-cost housing.

* Mississippi Gov. Ronnie Musgrove, in his recent "state of the state" address, proposed using inmates to build modular homes, as a way to create more affordable housing.

Affordable-housing advocates welcome such proposals, but they say government should be investing even more.

"It's a start, but we'll see if it comes to fruition," says Joe Heaphy of New York State Tenants and Neighbors, a nonprofit advocacy group. "From our perspective, affordable housing continues to be under assault, and it's amazing to me not more is being done."

One of the biggest problems is that even if developers want to build affordable homes in thriving cities, it's almost impossible to do so without some kind of subsidy. Both land prices and construction costs have skyrocketed.

To cross this hurdle, officials at both the state and federal levels are increasingly using public money to leverage private investment. This summer, HUD announced an ambitious $488 billion program to leverage the development of affordable housing nationwide - the biggest program of its kind ever undertaken by HUD.

Housing experts say such public-private partnerships are the best way to create more entry-level homes. As proof, they point to a New York neighborhood: the South Bronx. Twenty years ago, the area was a symbol of urban devastation. Whole blocks had been burned out. Crime was rampant, and businesses fled.

That's where Jose Rojas grew up. In his early years, his family moved a lot - he counts on his fingers the addresses of six different apartments. He played soccer in the abandoned lots.

Then his parents, immigrants from Puerto Rico, heard about the New York City Housing Partnership. It was building private two- and three-family houses in the neighborhood.

"At first, everybody in the Bronx was scared. There'd never been homeownership here," says Orlando Marin, an architect at the partnership and a member of the Bronx Community Board. "It was a risk, and after the burning of the Bronx in '77, people said, 'Who would want to buy in the South Bronx?' "

With the help of federal and state subsidies to cover part of the construction cost, the partnership was able to sell to a few, courageous working families. The idea was to give them not only homes, but also an income stream from the rental units to ensure they could meet their mortgages, even in the worst of times.

"Before this, people there literally didn't have an opportunity to climb onto what is the first rung in the wealth-creation ladder in this country, which is homeownership," says Kathryn Wilde, president and CEO of the New York City Partnership. "It's the basis from which you send your kids to college, borrow to start a business. It's the trajectory into the middle class."

The Rojas family, which bought into one of the early developments, is firmly settled there. Jose Rojas attended college. He's now a city corrections guard. He rented from his parents until 1996, when he'd saved enough to buy his own three-family home from the partnership.

"I had a chance to move upstate if I wanted to, but we decided we lived in this neighborhood 37 years, so I said, 'Let me just stay here,' " he says. "If I'm going to bring in the money, I want to bring it into my neighborhood. And the Bronx is coming up, believe me."

The South Bronx now has a thriving middle class, with growing political clout. The streets here are now plowed first thing, and the garbage gets picked up regularly.

"It's one of the largest social experiments in the country," says Michael Schill of the Center for Real Estate and Urban Policy at New York University Law School. "It's literally rebuilt the South Bronx, breathed new life into it."

Housing advocates across the country have looked to the partnership's work and tried to replicate it. But some experts are skeptical that such interventions can affect the nation's larger housing market.

"But I do think if the economy slows appreciably, that will bring down housing prices," says Stuart Gabriel of the Lusk Center for Real Estate at the University of Southern California. "The problem is that if it slows down too much, it does make it more difficult to help the people who are still underhoused or need to buy a home."